ABIDA MOHAMMED RAKHANGI, MUMBAI V. ITO 18(2)(4), MUMBAI

ITA 5448/MUM/2013

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9480 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 16-09-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 12-08-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV
• Keywords: Reopening of assessment; Unexplained investment; Gift; Additional evidence; Reasonable cause; Valuation report
• Section: 143(3); 234B; 131; 69; 148; 132

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO. 4084/ MUM/2013 ( / ASSESSMENT YEAR 2005-06) ./ I.T.A. NO. 5448/MUM/2013 ( / ASSESSMENT YEAR 2007-08) LATE SMT. ABIDA MOHAMMED RAKHANGI THROUGH LEGAL HEIRS MUKHTAR RAKHANGI , AZIM RAKHANGI & SALIM RAKHANGI RAKHANGI GAS SERVICES, 22, MUSLIM CEMETRY, S B MARG, NEAR RAKHANGI CHOWL, LOWER PAREL, MUMBAI 400013 / V. ITO-18(2)(4), 109, 1 ST FLOOR, PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI 400012. ./ PAN :AABPR1071K ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY: SHRI DHARAN GANDHI REVENUE BY : SHRI RAJESH KUMAR YADAV / DATE OF HEARING : 18.09.2017 / DATE OF PRONOUNCEMENT : 29.09.2017 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THESE TWO APPEAL, FILED BY THE ASSESSEE, BEING ITA NO. 4048/MUM/2013 & ITA NO. 5448/MUM/2013 FOR ASSESSMEN T YEARS 2005-06 AND 2007-08 RESPECTIVELY ARE DIRECTED AGAINST THE A PPELLATE ORDER DATED 23.04.2013 & 03.06.2013 RESPECTIVELY PASSED BY LEAR NED COMMISSIONER OF INCOME TAX (APPEALS)-29, MUMBAI (HEREINAFTER CALLED THE CIT(A)), APPELLATE PROCEEDINGS HAD ARISEN BEFORE LEARNED CIT(A) FROM T HE ASSESSMENT ORDERS BOTH DATED 22-12-2011 PASSED BY LEARNED ASSESSING O FFICER (HEREINAFTER I.T.A. NO. 4084& 5448/MUM/2013 2 CALLED THE AO) U/S 143(3) R.W.S. 147 OF THE INCOM E-TAX ACT, 1961 (HEREINAFTER CALLED THE ACT). 2. THE GROUNDS OF APPEAL IN I.T.A. NO. 4084/MUM/20 13 RAISED BY THE ASSESSEE IN THE MEMO OF APPEAL FILED WITH THE INC OME-TAX APPELLATE TRIBUNAL, MUMBAI (HEREINAFTER CALLED THE TRIBUNAL ) READ AS UNDER:- 1. UNDER THE FACTS AND CIRCUMSTANCES OF YOUR APPEL LANT, THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS. 12,50,000 MADE BY THE ASSESSING OFFICER BY TREATING THE INVES TMENT MADE IN FIXED DEPOSITS AS UNEXPLAINED INVESTMENT U/S.69 OF THE IN COME-TAX, ACT, 1961. 2. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FAC T THAT YOUR APPELLANT HAS MADE INVESTMENT IN FIXED DEPOSITS FRO M SALE OF GOLD ORNAMENTS. 3. THE LEARNED CIT(A) HAS ERRED IN STATING THAT YOU R APPELLANT HAS NOT FILED ANY EVIDENCE TO SUBSTANTIATE THAT SHE WAS IN THE POSSESSION OF GOLD JEWELLERY AS ON 31.03.2004 WHICH WAS SUBSEQUEN TLY SOLD BY THE APPELLANT. 3.01 THE LEARNED CIT(A) FAILED TO APPRECIATE THE LE TTER FILED WITH A.O VIDE LETTER DATED 10 TH OCTOBER,2012 IN WHICH VALUATION REPORT OF JEWELLERY AS ON 31/03/2002 VIDE VALUER'S REPORT DAT ED 16/04/2002. 4. THE LEARNED CIT(A) FAILED TO APPRECIATE THE CONF IRMATIONS OBTAINED FROM THE BUYERS WITH RESPECT TO THE SALE O F GOLD ORNAMENTS. 5. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT BUYERS HAVE UTILIZED THEIR AGRICULTURAL INCOME TO FUND THEIR PU RCHASE. THE DETAILS WITH RESPECT TO THEIR OWNERSHIP OF THE AGRICULTURE LAND HAD BEEN PROVIDED ALONG WITH CONFIRMATIONS. 6. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT YOUR APPELLANT HAS SUO-MOTO OFFERED LONG TERM CAPITAL GA IN/LOSS ON SALE OF JEWELLERY FOR THE ASSESSMENT YEAR UNDER CONSIDERATI ON DURING THE COURSE OF APPELLATE PROCEEDINGS. 7. THE LEARNED CIT(A) HAS ERRED IN HOLDING THAT APP ELLANT HAS NOT GIVEN ANY PROOF TO SUBSTANTIATE THAT YOUR APPELLANT WAS IN THE POSSESSION OF GOLD JEWELLERY AND THERE WERE ALSO NO CORROBORATING EVIDENCE TO PROVE THAT THIS GOLD JEWELLERY WAS SOLD BY HER TO HER RELATIVES IN CASH. 8. THE LEARNED CIT(A) HAS FAILED TO APPRECIATE THE REMAND REPORT SUBMITTED BY A.O WHICH WAS SUBMITTED BY A.O AFTER C ONSIDERING ALL THE EVIDENCES PRODUCE BY YOUR APPELLANT. 9. THE LEARNED CIT(A) HAS ERRED IN HOLDING THAT AP PELLANT HAS PRODUCED ONLY TWO PERSONS WHO HAVE CLAIMED TO HAVE PURCHASED THE I.T.A. NO. 4084& 5448/MUM/2013 3 JEWELLERY FROM THE APPELLANT B THEIR CLAIMS ARE NOT SUPPORTED BY ANY EVIDENCE. 9.01 THE LEARNED CIT(A) HAS ERRED IN HOLDING THAT A PPELLANT HAS NOT FILED ANY EVIDENCE IN RESPECT OF ANOTHER TWO PERSON S. 9.02 THE LEARNED CIT(A) HAS FAILED TO APPRECIATE TH E REMAND REPORT IN WHICH IT IS CLEARLY STATED THAT IN RESPECT OF ANOTH ER TWO PERSONS DOCUMENTARY EVIDENCES WERE PRODUCED AND FURNISHED. 10. THE CIT(A) HAS ERRED IN HOLDING THAT APPELLANT HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF INVESTMENT OF RS 12,50,000 /- MADE IN THE FDS IN KOKAN MERCANTILE BANK. 11. UNDER THE FACTS AND CIRCUMSTANCES OF YOUR APPEL LANT, LEARNED CIT(A) HAS ERRED CONFIRMING THE LEVY OF INTEREST U/ S 234A AND 234B OF THE INCOME TAX ACT,1961. 12. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER OR DE LETE ANY OF THE ABOVE GROUNDS OF APPEAL. 3. THE GROUNDS OF APPEAL IN I.T.A. NO. 5448/MUM/20 13 RAISED BY THE ASSESSEE IN THE MEMO OF APPEAL FILED WITH THE TRI BUNAL READ AS UNDER:- 1. UNDER THE FACTS AND CIRCUMSTANCES OF YOUR APPELL ANT, THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS. 30,00,000 MADE BY THE ASSESSING OFFICER BY TREATING THE INVES TMENT MADE IN FIXED DEPOSITS AS UNEXPLAINED INVESTMENT U/S.69 OF THE IN COME-TAX, ACT, 1961. 2. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT YOUR APPELLANT HAS MADE INVESTMENT IN FIXED DEPOSITS FRO M SALE OF GOLD ORNAMENTS AND SILVER. 3. THE LEARNED CIT(A) HAS ERRED IN STATING THAT YOU R APPELLANT HAS NOT FILED ANY EVIDENCE TO SUBSTANTIATE THAT SHE WAS IN THE POSSESSION OF GOLD JEWELLERY AS ON 31.03.2002 WHICH WAS SUBSEQUEN TLY SOLD BY THE APPELLANT. 3.01 THE LEARNED CIT(A) FAILED TO APPRECIATE THE LE TTER FILED WITH A.O VIDE LETTER DATED 10 TH OCTOBER,2012 IN WHICH VALUATION REPORT OF JEWELLERY AS ON 31/03/2002 VIDE VALUER'S REPORT DAT ED 16/04/2002. I.T.A. NO. 4084& 5448/MUM/2013 4 4. THE LEARNED CIT (A) FAILED TO APPRECIATE THE CON FIRMATIONS OBTAINED FROM THE BUYERS WITH RESPECT TO THE SALE O F GOLD ORNAMENTS. 5. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT BUYERS HAVE UTILIZED THEIR AGRICULTURAL INCOME BY SALE OF MANGO ES TO FUND THEIR PURCHASE. THE DETAILS WITH RESPECT TO THEIR OWNERSH IP OF THE AGRICULTURE LAND HAD BEEN PROVIDED ALONG WITH CONFIRMATIONS. 6. THE LEARNED CIT(A) FAILED TO APPRECIATE THE FACT THAT YOUR APPELLANT HAS SUO-MOTO OFFERED LONG TERM CAPITAL GA IN/LOSS ON SALE OF JEWELLERY FOR THE ASSESSMENT YEAR UNDER CONSIDERATI ON DURING THE COURSE OF APPELLATE PROCEEDINGS. 7. THE LEARNED CIT(A) HAS ERRED IN HOLDING THAT APP ELLANT HAS NOT GIVEN ANY PROOF TO SUBSTANTIATE THAT YOUR APPELLANT WAS IN THE POSSESSION OF GOLD JEWELLERY AND THERE WERE ALSO NO CORROBORATING EVIDENCE TO PROVE THAT THIS GOLD JEWELLERY WAS SOLD BY HER TO HER RELATIVES IN CASH. 8. THE LEARNED CIT(A) HAS ERRED IN HOLDING THAT APP ELLANT HAS NOT GIVEN ANY PROOF TO SUBSTANTIATE THAT YOUR APPELLANT HAS RECEIVED GIFT OF RS 300,000/- FROM MR ABDUL RAKHANGI. 8.01 THE LEARNED CIT(A) FAILED TO APPRECIATE THE RE MAND REPORT IN WHICH IT IS CLEARLY STATED VIDE POINT 5 OF REMAND REPORT OF A.O THAT MR ABDUL RAKHANGI HAS CONFIRMED VIDE LETTER DATED 16/08/2012 THAT HE HAS GIFTED IN CASH RS 300,000/- ON 26.07.2006 AND THE S AME WAS GIVEN OUT OF HIS AGRICULTURE INCOME AND PAST SAVINGS. 9. THE LEARNED CIT (A) HAS FAILED TO APPRECIATE THE REMAND REPORT SUBMITTED BY A.O WHICH WAS SUBMITTED BY A.O AFTER C ONSIDERING ALL THE EVIDENCES PRODUCE BY YOUR APPELLANT. 10. THE LEARNED CIT (A) HAS ERRED, IN HOLDING THAT APPELLANT HAS PRODUCED ONLY TWO PERSONS WHO HAVE CLAIMED TO HAVE PURCHASED THE I.T.A. NO. 4084& 5448/MUM/2013 5 JEWELLERY FROM THE APPELLANT BUT THEIR CLAIMS ARE N OT SUPPORTED BY ANY EVIDENCE. 10.01 THE LEARNED CIT (A) HAS ERRED IN .HOLDING THA T APPELLANT HAS NOT FILED ANY EVIDENCE IN RESPECT OF ANOTHER THREE PERS ONS. 10.02 THE LEARNED CIT (A) HAS FAILED TO APPRECIATE THE REMAND REPORT IN WHICH IT IS CLEARLY STATED THAT IN RESPECT OF ANOTH ER TWO PERSONS DOCUMENTARY EVIDENCES WERE PRODUCED AND FURNISHED. 11. THE CIT(A) HAS ERRED IN HOLDING THAT APPELLANT HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF INVESTMENT OF RS 30,00,000 /- MADE IN THE FDS IN KOKAN MERCANTILE BANK AND BOMBAY MERCANTILE BANK . 12. UNDER THE FACTS AND-CIRCUMSTANCES OF YOUR APPEL LANT, LEARNED CIT (A) HAS ERRED IN CONFIRMING THE LEVY OF INTEREST U/ S 234A AND 234B OF THE INCOME TAX ACT, 1961. 13. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER OR DE LETE ANY OF THE ABOVE GROUNDS OF APPEAL. 4. FIRST WE SHALL TAKE UP APPEAL FOR ASSESSMENT YEA R 2005-06 IN ITA NO. 4084/MUM/2013. THE ASSESSEE FILED RETURN OF INCOME FOR ASSESSMENT YEAR 2005-06 ON 29.10.2005 DECLARING TOTAL INCOME OF RS. 46,096/- WHICH WAS PROCESSED BY REVENUE U/S. 143(1) OF THE ACT. IN TH E CASE OF THE ASSESSEE , THE ASSESSMENT FOR ASSESSMENT YEAR 2008-09 WAS COMP LETED U/S 143(3) ON 27.12.2010, WHEREIN DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS OBSERVED BY THE AO THAT ASSESSEE HAS MADE CERTAIN D EPOSITS WITH KOKAN MERCANTILE BANK AND BOMBAY MERCANTILE BANK ON VARIO US DATES AND YEARS AND THEIR MATURITY AMOUNT ALONG WITH INTEREST ACCRU ED THERE ON WAS CREDITED IN KOKAN MERCANTILE BANK SAVING BANK ACCOUNT WHICH WERE NOT DECLARED IN THE RETURN OF INCOME FILED WITH REVENUE AND SAME WA S NOT OFFERED FOR TAXATION. THE AO MADE ADDITIONS TO THE INCOME OF T HE ASSESSEE ON ACCOUNT OF INTEREST ON MATURED FD/RDS FOR ASSESSMENT YEAR 2008-09 . IT WAS OBSERVED BY THE AO THAT THE ASSESSEE DID NOT DISCLO SED ALL THE MATERIAL FACTS IN THE RETURN OF INCOME REGARDING THE SOURCE OF FDS , HENCE, THE CASE FOR I.T.A. NO. 4084& 5448/MUM/2013 6 ASSESSMENT YEAR 2005-06 WERE REOPENED BY THE AO U/S 147 WHICH CULMINATED IN THE ISSUE OF NOTICE U/S. 148 DATED 1 8.03.2011 WHICH WAS SERVED ON ASSESSEE ON 23-03-2011. THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCES OF MAKING DEPOSITS IN THE BANK TO THE TUNE OF RS.12.50 LACS WHICH WAS MADE IN KOKAN MERCANTILE BANK AND WAS NOT DECLA RED IN THE BALANCE SHEET FILED BY THE ASSESSEE . THE ASSESSEE DID NOT DECLARED THE SOURCES OF MAKING SUCH INVESTMENTS BY WAY OF DEPOSIT IN KOKAN MERCANTILE BANK . THE ASSESSEE DID NOT GIVE ANY EXPLANATION AS TO WHY THI S BANK ACCOUNT WAS NOT DECLARED TO REVENUE NOR ANY DETAILS/EXPLANATIONS WE RE FURNISHED BY THE ASSESSEE , WHICH LED TO ADDITION TO THE TUNE OF 12, 50,000/- W.R.T. DEPOSITS MADE WITH KOKAN MERCANTILE BANK AS UNEXPLAINED IN VESTMENT U/S. 69 OF THE ACT, VIDE ASSESSMENT ORDER DATED 22-12-2011 PAS SED BY THE AO U/S 143(3) R.W.S. 147. THE DETAILS OF SAID DEPOSITS ARE AS UNDER:- 5. THE ASSESSEE FILED FIRST APPEAL WITH LEARNED CIT (A) AGAINST ASSESSMENT ORDER DATED 22-12-2011 PASSED BY THE AO U/S 143(3) R.W.S. 147. THE ASSESSEE MADE A CLAIM BEFORE LEARNED CIT(A) THAT TH E ASSESSEE BEING A SENIOR CITIZEN OF 80-YEAR-OLD BECAUSE OF HER ILLNESS WAS N OT ABLE TO FURNISH THE DETAILS CALLED FOR BY THE AO . THE ASSESSEE FILED A DDITIONAL EVIDENCES BEFORE LEARNED CIT(A) IN ORDER TO EXPLAIN THE SOURCES FROM WHICH INVESTMENTS WERE MADE IN THE FD AND THE REQUEST WAS MADE TO ADMIT TH E ADDITIONAL EVIDENCES AND IT WAS CLAIMED THAT THE ASSESSEE IS VERY SENIOR CITIZEN OF 80 YEARS OF AGE WHICH IS IN ITSELF A REASONABLE CAUSE FOR NOT FILIN G OF EVIDENCES BEFORE THE AO. DATE OF DEPOSITS/BANK DATE OF DEPOSIT DEP. AMOUNT MATURITY AMOUNT INTEREST WHICH WAS NOT INCORPORATED KOKAN MECANTILE BANK 01.01.2005 2,50,000 2,58,058 58,058 KOKAN MECANTILE BANK 03.05.2004 2,00,000 2,42,652 42,652 KOKAN MECANTILE BANK 03.05.2004 2,00,000 2,42,652 42,652 KOKAN MECANTILE BANK 03.05.2004 2,00,000 2,42,652 42,652 KOKAN MECANTILE BANK 03.05.2004 2,00,000 2,42,652 42,652 KOKAN MECANTILE BANK 03.05.2004 2,00,000 2,42,652 42,652 KOKAN MECANTILE BANK 03.05.2004 2,00,000 2,42,652 42,652 TOTAL 12,50,000 271318 I.T.A. NO. 4084& 5448/MUM/2013 7 THE LEARNED CIT(A) ADMITTED THE ADDITIONAL EVIDENC ES AND THE SAID ADDITIONAL EVIDENCES WERE FORWARDED BY LEARNED CIT(A) TO A.O F OR HIS COMMENTS. THE A.O SUBMITTED REMAND REPORT , A COPY OF WHICH WAS G IVEN TO THE ASSESSEE AND THE ASSESSEE SUBMITTED ITS COMMENTS TO THE REMA ND REPORT . THE LEARNED CIT(A) DISMISSED THE APPEAL OF ASSESSEE VIDE APPELL ATE ORDER DATED 23-04- 2013 , BY HOLDING AS UNDER:- 3.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE, ARGUMENTS OF THE ASSESSING OFFICER, FINDING RECORDED IN THE REMA ND REPORT AND THE WRITTEN SUBMISSIONS OF THE AUTHORISED REPRESENTATIV E OF THE APPELLANT. THE ISSUE IN THIS CASE IS REGARDING SOURCE OF INVES TMENT OF RS.12,50,000/- MADE BY THE APPELLANT IN FDS IN KOKA N MERCANTILE BANK. THE APPELLANT CLAIMED THAT SHE HAD SOLD GOLD ORNAMENTS TO FOLLOWING 4 PERSONS AND THE SALE PROCEEDS WERE DEPO SITED IN THE FDS IN KOKAN MERCANTILE BANK. S.NO. NAME WEIGHT DATE AMOUNT 1. ABDUL KADER RAKHANGI AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 569 GMS. 18.04.2004 3,51,640 2. REHANA KALSEKAR AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 675 GMS. 30.04.2004 3,94,875 3. ISMAIL ABDUL RAKHANGI AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 512 GMS. 10.06.2004 3,03,360 4. ALI SAHEB KAZI AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 330 GMS. 25.12.2004 2,04,765 3.3.1 DURING REMAND PROCEEDINGS THE ASSESSING OFFIC ER HAS RECORDED STATEMENT OF PERSONS MENTIONED AT SR. NO. 1 AND 2 A BOVE U/S. 131 OF THE I.T. ACT. REGARDING PERSONS AT SR. NO.3 AND 4 A BOVE THE ASSESSING OFFICER HAS MENTIONED IN THE REMAND REPOST THAT DOC UMENTARY EVIDENCES WERE PRODUCED. HOWEVER, THE ASSESSING OFF ICER HAS NOT MENTIONED ANY DETAILS OF THE NATURE OF EVIDENCES PR ODUCED AND WHY THE I.T.A. NO. 4084& 5448/MUM/2013 8 SAME WERE ACCEPTABLE. THE ASSESSING OFFICER HAS SUM MED UP HIS FINDINGS IN THE REMAND REPORT AS BELOW: 'THE FACTS GATHERED FROM THE ABOVEMENTIONED STATEME NTS AND DETAILS ARE AS UNDER: A) ASSESSEE HAS SOLD HER ORNAMENTS WHICH WERE RECEI VED TO HER IN WEDDING BY WAY OF MEHER. B) THE ORNAMENTS SOLD TO THE CLOSED RELATIVE IN CAS H AND SUBSEQUENTLY CASH DEPOSITED IN THE BANK. C) THE FACTS HAS BEEN SUBSTANTIATE WITH THE STATEME NT GIVEN ON OATH BY THE CONFIRMING PARTIES. D) THE PARTIES WHOM WERE PURCHASED GOLD FROM THE AS SESSEE WERE EARNED AGRICULTURAL INCOME BY SALE OF MANGOES. THE CASH PROCEED RECEIVED BY THEM IS BASICALLY IN CASH, THEREFORE TH EY HAD PURCHASED GOLD FROM THE ASSESSEE IN CASH. E) THE ASSESSEE IS BEING IN HARDSHIP AND BEING THE MEMBERS OF THE FAMILY THE PARTIES ARE DECIDED UPON TO PURCHASE THE ORNAMENTS FROM THE ASSESSEE. F) MOREOVER, THE ASSESSEE HAS SUO-MOTO OFFERED LO NG TERM CAPITAL GAIN/LOSS SALE OF JEWELLERY FOR THE ASSESSMENT YEAR UNDER CONSIDERATION.' THE ASSESSING OFFICER HAD ALSO REQUESTED NOT TO ACC EPT THE ADDITIONAL EVIDENCES AS ADEQUATE OPPORTUNITIES WERE OFFERED TO THE APPELLANT DURING ASSESSMENT PROCEEDINGS. 3.3.2 AFTER GOING THROUGH THE COPIES OF THE STATEME NT OF TWO PARTIES ENCLOSED WITH THE REMAND REPORT FOLLOWING IMPORTANT OBSERVATIONS HAVE BEEN NOTED:- (I) BOTH THE PARTIES HAVE NO PAN AND HAVE NEVER FI LED RETURN OF INCOME TILL DATE. (II) THE SOURCE OF THEIR INCOME HAVE BEEN CLAIMED T O BE BY GROWING MANGOES ON AGRICULTURAL LAND AND SELLING THE SAME T HROUGH AGENTS. IN SUPPORT OF THE EARNING OF INCOME, THEY HAD SUBMITTE D INCOME CERTIFICATE ISSUED BY THE COLLECTOR OFFICE FOR THE PURPOSE OF B ANK LOAN. AS PER THESE CERTIFICATES, THE ANNUAL INCOME OF SHRI ABDUL KADIR RAKANGI WAS RS.5 TO 6 LAKHS FOR FY.2004-05 AND OF REHANA KALSEKAR WAS O F RS.7 LAKHS FOR FY.2004-05 I.T.A. NO. 4084& 5448/MUM/2013 9 (III) BOTH THE PARTIES HAVE CLAIMED TO BE RELATIVES OF THE APPELLANT AND STATED THAT THEY HAD PURCHASED GOLD ORNAMENTS F ROM HER IN CASH AS THE APPELLANT WAS IN NEED OF MONEY. (IV) BOTH OF THEM DID NOT HAVE ANY DETAILS OF ITEMW ISE PURCHASE OF ORNAMENTS. (V) THE COPIES OF THEIR BANK ACCOUNTS OR PASSBOOKS WERE NOT PRODUCED SHOWING THE SUMS OF PAYMENT BY THEM. (VI) THERE IS NO PROOF AVAILABLE EITHER WITH APPELL ANT OR WITH THE PARTIES TO SUBSTANTIATE THAT THEY HAVE ACTUALLY PUR CHASED GOLD ORNAMENTS FROM APPELLANT BY PAYING CASH. (VII) A COPY OF THE APPELLANT'S BALANCE SHEET AS ON 31.3.2005 HAS BEEN FILED. APPELLANT HAS FAILED AND TO FILE ANY EV IDENCE TO SUBSTANTIATE THAT SHE WAS IN THE POSSESSION OF GOLD JEWELLERY AS ON 31.3.2004 WHICH WAS SUBSEQUENTLY SOLD BY THE APPELLANT. NO BALANCE SHEET REFLECTING THE POSSESSION OF JEWELLERY AS ON 31.3.2004 HAS BEE N FILED EITHER DURING ASSESSMENT PROCEEDINGS OR DURING APPELLATE PROCEEDI NGS. (VIII) APPELLANT HAS NOT DISCLOSED ANY CAPITAL GAIN /LOSS ON SALE OF GOLD JEWELLERY IN THE RETURN OF INCOME FILED FOR A.Y 200 5-06. 3.3.3 IN VIEW OF THE ABOVE FACTS IT IS CLEAR THAT A PPELLANT HAS NOT GIVEN ANY PROOF TILL DATE TO SUBSTANTIATE THAT SHE WAS IN THE POSSESSION OF GOLD JEWELLERY AND THERE WERE ALSO NO CORROBORATING EVIDENCE TO PROVE THAT THIS GOLD JEWELLERY WAS SOLD BY HER TO HER REL ATIVES IN CASH. ONLY TWO PERSONS WERE PRODUCED WHO HAVE CLAIMED TO HAVE PURCHASED THE JEWELLERY FROM THE APPELLANT BUT THEIR CLAIMS ARE A LSO NOT SUPPORTED BY ANY EVIDENCE. IN RESPECT OF ANOTHER TWO PERSONS THE RE IS NO DETAILS IN THE FILE TILL DATE THAT WHAT KIND OF EVIDENCES WERE PRODUCED BY THE APPELLANT TO SUBSTANTIATE THE CLAIM. THE PURCHASES HAVE BEEN CLAIMED TO BE MADE IN CASH. ONCE THE ACQUISITION OR POSSESS ION OF GOLD JEWELLERY BY THE APPELLANT CANNOT BE PROVED BY FILING CORROBO RATIVE EVIDENCES, HOW SALE OF THIS JEWELLERY CAN BE RELIED UPON AS A SOURCE FOR DEPOSITING RS.12,50,000/- IN FIXED DEPOSITS. IN VIEW OF ABOVE OBSERVATIONS, THIS IT IS HELD THAT APPELLANT HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF INVESTMENT OF RS.12,50,000/- MADE IN THE FDS IN KOK AN MERCANTILE BANK. ACCORDINGLY, THE ASSESSING OFFICER WAS JUSTIF IED IN TREATING THIS INVESTMENT OF RS.12,50,000/- AS UNEXPLAINED INVESTM ENT U/S.69 OF THE I.T.ACT AND ALSO TREATING THE INTEREST THEREON AS U NEXPLAINED INCOME OF THE APPELLANT. THEREFORE THESE GROUNDS ARE DISMISSE D . I.T.A. NO. 4084& 5448/MUM/2013 10 6. THE ASSESSEE FILED AN APPEAL BEFORE THE TRIBUNAL CHALLENGING THE APPELLATE ORDER DATED 23-04-2013 PASSED BY LEARNED CIT(A). 7. THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET S UBMITTED THAT THE WHOLE CONTROVERSY REVOLVES AROUND ONE ISSUE THAT IS THE I NVESTMENT MADE BY THE ASSESSEE IN FDR WITH BANK TO THE TUNE OF RS. 12.50 LACS(A.Y.2007-08-RS. 30 LACS) AND SOURCES FOR MAKING SUCH INVESTMENTS IN FD R. IT WAS SUBMITTED THAT THE ASSESSEE MADE AN INVESTMENT IN FDRS WITH BANKS TO THE TUNE OF RS. 12.5 LAKH DURING THE IMPUGNED ASSESSMENT YEAR W HICH WAS ADDED U/S. 69 AS AN UNEXPLAINED INVESTMENT. IT WAS SUBMITTED THAT THE ASSESSEE DIED ON 2 ND FEBRUARY 2017 AND IT WAS SUBMITTED THAT DEATH CERT IFICATE DATED 20- 02-2017 ISSUED BY GOVERNMENT OF MAHARASHTRA IS FILE D WITH THE TRIBUNAL ( WHICH IS PLACED IN FILE) . IT WAS SUBMITTED THAT TH E LEGAL HEIRS OF THE ASSESSEE ARE ALREADY BROUGHT ON RECORD WHO ARE THREE SONS OF THE ASSESSEE AND ARE ONLY LEGAL HEIRS. IT WAS SUBMITTED THAT REVISED FOR M 36 HAS BEEN FILED WITH THE TRIBUNAL TO BRING ON RECORD LEGAL HEIRS. IT WAS SUBMITTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR A.Y 2008-09 U/ S 143(3) R.W.S. 143(2), THE A.O FOUND THAT THE ASSESSEE HAS NOT DISCLOSED B ANK FDRS MADE IN THE EARLIER YEARS AND INTEREST THEREON CREDITED IN SAVI NG BANK ON KOKAN MERCANTILE BANK IN THE RETURN OF INCOME FILED WITH REVENUE WHICH LED TO THE ADDITION OF THE INTEREST IN A.Y 2008-09 . IT WAS SU BMITTED THAT THE INVESTMENTS MADE IN BANK FDRS IN ASSESSMENT YEAR 2 005-06 WERE RS. 12.50 LACS( RS. 30 LACS FOR ASSESSMENT YEAR 2007-08 ) WHICH WERE NOT DISCLOSED TO THE REVENUE IN THE RETURN OF INCOME FI LED WITH THE REVENUE AS THEY WERE NOT REFLECTED IN THE BALANCE SHEET OF THE ASSESSEE AND ALSO INTEREST EARNED ON THE SAID FDRS WERE CREDITED WITH SAVING BANK ACCOUNT WITH KOKAN MERCANTILE BANK WHICH WAS ALSO NOT DISCLOSED TO REVENUE WHICH LED TO THE REOPENING OF THE CONCLUDED ASSESSMENTS FOR T HE A.Y 2005-06 AND 2007-08 . IT WAS SUBMITTED THAT NO REPRESENTATION C OULD BE MADE BEFORE THE A.O AS THE ASSESSEE WAS AN OLD LADY OF MORE THAN 80 YEARS WHO COULD NOT MAKE PROPER REPRESENTATION BEFORE THE A.O . OUR A TTENTION WAS DRAWN TO ASSESSMENT ORDER PAGE 2/PARA 4 AND IT WAS SUBMITTED THAT ASSESSEES COUNSEL ATTENDED BEFORE THE AO BUT DID NOT FILE THE REQUIRED DOCUMENTS/EXPLANATIONS AS WERE REQUIRED BY THE AO, WHICH WERE SUBMITTED BEFORE LEARNED CIT(A). IT WAS SUBMITTED THAT THE AO HAS MADE THE ADDITION OF I.T.A. NO. 4084& 5448/MUM/2013 11 RS 12.50 LACS FOR ASSESSMENT YEAR 2005-06( RS. 30 L ACS FOR AY 2007-08) U/S. 69 AS AN UNEXPLAINED INVESTMENT AS THE INVESTMENTS MADE IN THE FDS WITH THE BANK WERE NOT DISCLOSED IN THE RETURN OF INCOME FILED WITH THE REVENUE AND ALSO SOURCES OF MAKING INVESTMENT IN BANK FDR S COULD NOT BE EXPLAINED. IT WAS SUBMITTED THAT THE ADDITIONAL EVI DENCES WERE SUBMITTED BEFORE THE LEARNED CIT(A) WHICH WERE FORWARDED BY L EARNED CIT(A) TO THE A.O AND REMAND REPORT WAS CALLED . IT WAS SUBMITTED THA T A.O ACCEPTED THE SOURCES OF INVESTMENT IN REMAND REPORT PROCEEDINGS BUT LEARNED CIT(A) DID NOT ACCEPT REMAND REPORT AND SUSTAINED ADDITIONS . OUR ATTENTION WAS DRAWN TO PAGE NO. 2 OF THE A.O ORDER /PARA 4 AND IT WAS S UBMITTED THAT THE ASSESSEE DULY ATTENDED THE HEARING BUT COULD NOT FI LE COMPLETE DETAILS BEFORE THE A.O. . 8.ON THE OTHER HAND, LD. DR SUBMITTED THAT THE DURI NG THE APPELLATE PROCEEDINGS , THE ASSESSEE HAS SUBMITTED SOME DETAI LS OF THE SOURCES OF THE MAKING OF THE INVESTMENTS IN THE FDRS AND THE A.O IN REMAND REPORT HAS ONLY ASKED THE LEARNED CIT(A) TO DEAL WITH THE SAID EXPLANATIONS SUBMITTED BY THE ASSESSEE ON MERITS. OUR ATTENTION WAS DRAWN TO APPELLATE ORDER OF LEARNED CIT(A) AT PAGE 4 WHEREIN THE AO HAS ONLY AS KED THE LEARNED CIT(A) TO DEAL WITH THE CONTENTION OF THE ASSESSEE ON MERITS. IT WAS SUBMITTED THAT INCOME FROM LONG TERM CAPITAL GAINS(LOSS) WAS NOT D ECLARED IN THE RETURN OF INCOME FILED WITH THE REVENUE BUT THE SAID CAPITAL GAINS WERE DECLARED DURING THE COURSE OF APPELLATE/REMAND REPORT PROCEE DINGS. OUR ATTENTION WAS DRAWN TO PAGE 14 OF THE PAPER BOOK WHEREIN THE REMAND REPORT DATED 26.2.2013 IS PLACED WHEREIN THE AO REQUESTED THE LE ARNED CIT(A) TO DECIDE THE ISSUE OF SOURCE OF CASH DEPOSITS ON MERITS. OUR ATTENTION WAS DRAWN TO PAGE 5 OF LEARNED CIT(A) APPELLATE ORDER /PARA 3.3. 3 WHEREIN LEARNED CIT(A) HAS GIVEN HIS FINDINGS IN DETAIL THAT THE ASSESSEE HAS FAILED TO SUBSTANTIATE THAT SHE WAS IN POSSESSION OF GOLD JEWELLERY AND AL SO THE ASSESSEE FAILED TO SUBSTANTIATE THAT SHE SOLD THE GOLD JEWELLERY IN CA SH . 9. THE LD. COUNSEL IN REJOINDER RELIED UPON THE DEC ISION OF THE HONBLE SUPREME COURT IN THE CASE OF MEHTA PARIKH 30 ITR 18 1(SC) AND IT WAS SUBMITTED THAT AFFIDAVITS HAD BEEN SUBMITTED OF THE RELATIVES OF THE ASSESSEE WHO HAVE PURCHASED GOLD JEWELLERY FROM THE ASSESSEE . IT WAS SUBMITTED THAT THE AO/CIT(A) HAS NOT CROSS EXAMINED THESE PERSONS WHO HAVE GIVEN AFFIDAVITS . IT WAS SUBMITTED THAT THE LEARNED CIT( A) HAS NOT ACCEPTED THE I.T.A. NO. 4084& 5448/MUM/2013 12 FINDINGS OF THE A.O BUT DISMISSED THE APPEAL OF THE ASSESSEE . THE LEARNED COUNSEL FOR THE ASSESSEE RELIED UPON THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT V. SHANTI SWA ROOP (2002) 255 ITR 0655 (P&H HC) . OUR ATTENTION WAS DRAWN TO AFFIDAVI TS EXECUTED BY ASSESSEE NARRATING FACTS FOR AY 2005-06 AND 2007-08 WHICH AR E PLACED IN PAPER BOOK PAGE NO. 22 TO 23 AND ALSO PAGE NO. 40 TO 41. STATE MENTS ON OATH GIVEN BY THE PERSONS WHO HAVE PURCHASED GOLD FROM THE ASSES SEE ARE PLACED IN PAPER BOOK PAGE NO. 16 TO 18 AND 19 TO 21 . OUR ATTENTION WAS DRAWN TO REMAND REPORT ISSUED BY THE A.O. WHICH IS PLACED IN PAPER BOOK / PAGE NO. 8 TO 10 AND ALSO PAGE NO. 11 TO 15 FOR A.Y 2005-06 AND 2007 -08 . OUR ATTENTION WAS DRAWN TO QUESTION NO. 3 AND 4 RAISED BY THE REVENUE WHILE RECORDING STATEMENT ON OATH OF SH ABDUL FAQIR MOHAMMAD RAKHAN GI (RELATIVE OF THE ASSESSEE WHO BOUGHT GOLD JEWELLERY FROM ASSESSEE) W HEREIN HE STATED THAT HE IS HOLDING AGRICULTURAL LAND AT DASOOR WHICH IS ANC ESTRAL LAND AND THE ASSESSEE GREW MANGOES ON THE SAID AGRICULTURAL LAND (PB/PAGE 16) . IT IS SUBMITTED THAT LEARNED CIT(A) SUSTAINED THE ADDITIO NS ONLY ON SURMISES AND CONJECTURES. IT WAS SUBMITTED THAT THE LEARNED CIT( A) CANNOT IGNORE STATEMENTS/AFFIDAVIT WITHOUT CROSS EXAMINATION OF T HE PARTIES . IT WAS SUBMITTED THAT THE A.O HAS GIVEN A FAVOURABLE REPOR T IN FAVOUR OF THE ASSESSEE IN REMAND REPORT PROCEEDINGS WHILE LEARNED CIT(A) HAS ERRONEOUSLY DECIDED THE ISSUE AGAINST THE ASSESSEE . 10 LD. DR IN REPLY TO REJOINDER SUBMITTED THAT IT I S A WRONG CONTENTION ADVANCED BY THE ASSESSEE COUNSEL BEFORE THE TRIBUNA L AS THE AO HAS NOT GIVEN ANY FAVOURABLE REPORT IN REMAND PROCEEDINGS I N FAVOUR OF THE ASSESSEE AND AO HAS ONLY ASKED THE LEARNED CIT(A) TO DECIDE THE ISSUE ON MERITS . IT WAS SUBMITTED BY LEARNED DR THAT NO EVIDENCE HAS BE EN PRODUCED BY THE ASSESSEE TO SUBSTANTIATE ITS CONTENTIONS. IT IS SUB MITTED THAT NO SOURCES OF MAKING INVESTMENTS IN FDR HAVE BEEN DECLARED AND CO NTENTION OF THE ASSESSEE DOES NOT INSPIRE CONFIDENCE. IT IS SUBMITT ED THAT GENUINENESS OF THE TRANSACTION IS NOT PROVED. IT WAS SUBMITTED THAT C ASE LAWS RELIED UPON THE ASSESSEE ARE NOT APPLICABLE AND THE GENUINENESS OF TRANSACTION WAS NOT PROVED . IT WAS SUBMITTED THAT THE TRANSACTION WHIC H ARE SHOWN TO BE THE SOURCES OF THE CASH DEPOSITS IN THE BANK ARE FROM C LOSE RELATIVE WHICH DID NOT INSPIRE CONFIDENCE AS THE SAID PERSONS ARE NOT EVEN FILING RETURN OF INCOME WITH REVENUE AND IT WAS PRAYED THAT THE ADDI TION MAY BE CONFIRMED. I.T.A. NO. 4084& 5448/MUM/2013 13 11. WE HAVE CONSIDERED RIVAL CONTENTIONS AND PERUSE D THE MATERIAL ON RECORD INCLUDING CASE LAWS CITED BY THE BOTH THE PA RTIES . WE HAVE OBSERVED THAT ASSESSEE FILED ITS RETURN OF INCOME ON 29.10.2 005 U/S 139(1) WHEREIN INCOME DECLARED TO THE REVENUE WAS TO THE TUNE OF R S. 46,096/- . THE ASSESSEE CASE WAS PROCESSED BY REVENUE U/S. 143(1) AND NO SCRUTINY PROCEEDING WERE ORIGINALLY CONDUCTED AGAINST THE AS SESSEE U/S. 143 (2) R.W.S. 143(3) FOR IMPUGNED ASSESSMENT YEAR 2005-06. HOWEVE R, DURING THE COURSE OF ASSESSMENT PROCEEDINGS U/S 143(3) R.W.S. 143(2) FOR THE ASSESSMENT YEAR 2008-09 , IT WAS OBSERVED BY THE A.O THAT THE ASSES SEE HAS MADE FIXED DEPOSITS WITH KOKAN MERCANTILE BANK AND BOMBAY MERC ANTILE BANK IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEARS 2005 -06 AND 2007-08 AGAINST WHICH INTEREST INCOME HAS BEEN CREDITED IN KOKAN ME RCANTILE BANK SAVING BANK ACCOUNT, WHERE IN NEITHER INVESTMENTS IN BANK FDRS NOR INTEREST INCOME WAS DECLARED BY THE ASSESSEE TO THE REVENUE , WHICH LED TO THE REOPENING OF THE ASSESSMENT U/S. 147 OF THE ACT. T HE SAID SAVING BANK ACCOUNT WHEREIN INTEREST WAS CREDITED MAINTAINED WI TH KOKAN MERCANTILE BANK WAS ALSO NOT DECLARED TO THE REVENUE. THE ASSE SSEE WAS ASKED TO EXPLAIN THE SOURCES OF CASH DEPOSITS IN THE SAID BA NK ACCOUNT WHICH WERE USED TO MAKE FIXED DEPOSITS WITH THIS BANK TO THE T UNE OF RS. 12.50 LACS(RS. 30 LACS FOR AY 2007-08) , THE ASSESSEE DID NOT GIVE ANY DETAILS OF SOURCES OF MAKING SAID INVESTMENT DURING THE COURSE OF REASSES SMENT PROCEEDINGS U/S 147 WHICH LED TO THE ADDITIONS TO THE TUNE OF RS. 1 2.50 LACS( AY 2007-08 RS 30 LACS) TO THE INCOME FOR ASSESSMENT YEAR 2005-06 , VIDE ASSESSMENT ORDER DATED 22-12-2011 PASSED U/S 143(3) R.W.S. 147, WHIL E IN THE APPELLATE PROCEEDINGS BEFORE LEARNED CIT(A) IN THE FIRST APPE AL FILED BY THE ASSESSEE, THE ASSESSEE CAME FORWARD TO EXPLAIN THE SOURCES OF CASH RECEIPTS WHICH WERE DEPOSITED IN THE BANK ACCOUNT TO MAKE FDRS . THE ADDITIONAL EVIDENCES WERE FILED DURING COURSE OF APPELLATE PRO CEEDINGS BEFORE LEARNED CIT(A) WHICH WERE FORWARDED BY LD. CIT(A) TO THE A. O FOR REMAND REPORT. THE ASSESSEE DURING THE COURSE OF APPELLATE PROCEEDING BEFORE LEARNED CIT(A) HAS EXPLAINED THAT RS. 12.5 LAKH IN CASH WAS RECEIVED D URING THE IMPUGNED ASSESSMENT YEAR BY SELLING THE GOLD ORNAMENTS TO F OLLOWING FOUR PERSONS:- S.NO. NAME WEIGHT DATE AMOUNT 1. ABDUL KADER RAKHANGI AT & POST DASOOR 596 GMS. 18.04.2004 3,51,640 I.T.A. NO. 4084& 5448/MUM/2013 14 TALUKA-RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 2. REHANA KALSEKAR AT & POST DASOOR TALUKA-RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 675 GMS. 30.04.2004 3,94,875 3. ISMAIL ABDUL RAKHANGI AT & POST DASOOR TALUKA-RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 512 GMS. 10.06.2004 3,03,360 4. ALI SAHEB KAZI AT & POST DASOOR TALUKA-RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 330 GMS. 25.12.2004 2,04,765 DURING REMAND PROCEEDINGS BEFORE THE AO, THE A.O RE CORDED STATEMENTS ON OATH OF THE PERSONS AT SERIAL NO. 1 AND 2 ABOVE , U /S. 131 OF THE ACT WHILE FOR THE PERSON AT S.NO. 3 AND 4 ABOVE , IT IS STATED BY THE AO THAT DOCUMENTARY EVIDENCES WERE PRODUCED. THE SAID STATEMENTS AND DO CUMENTS FILED ARE PLACED BY THE ASSESSEE IN PAPER BOOK/PAGE 16-21 AND 26-36 . NOW COMING TO THE VARIOUS DOCUMENTS AND CONTENTION RAISED BY THE ASSESSEE DURING THE COURSE OF REMAND PROCEEDINGS BEFORE THE AO , IT IS OBSERVED THAT TWO PERSONS NAMELY SHRI ABDUL KADER FAQIR MOHAMMED RAKHANGI A ND MS. REHANA KALESKAR WHO HAVE STATED TO HAVE PURCHASED GOLD ORN AMENTS FROM THE ASSESSEE HAS GIVEN A STATEMENT UNDER OATH , WHEREIN SH ABDUL KADER FAQIR MOHAMMED RAKHANGI HAVE STATED ON OATH THAT HE DO NOT HOLD ANY PAN AND DID NOT ANY FILED ANY RETURN OF INCOME TILL DATE . HE CLAIMED THAT HE HAS SOME AGRICULTURAL LAND AT DASOOR WHICH IS ANCESTRAL PROP ERTY WHEREIN MANGOES ARE GROWN WHICH ARE SOLD THROUGH AGENTS. THAT HE CLAIME D THAT HE HAS INCOME OF RS.5 TO 6 LAKH IN FINANCIAL YEAR 2004-05 AND RS.6 T O 7.50 LAKH FOR FINANCIAL YEAR 2006-07. HE ALSO ENCLOSED ONE CERTIFICATE ISS UED BY THE COLLECTOR OFFICE TO SHOW HIS INCOME WHICH WAS OBTAINED FOR THE PURPO SES OF TAKING BANK LOAN. HE HAS CLAIMED THAT HIS AGRICULTURAL INCOME A ND PAST SAVINGS WERE USED TO BUY GOLD ORNAMENTS FROM THE ASSESSEE. HE WA S ASKED TO EXPLAIN ITEMWISE DETAILS OF ORNAMENT PURCHASED BUT HE COULD NOT GIVE ANY DETAIL OF THE ITEM WISE ORNAMENT PURCHASED FROM THE ASSESSEE BUT HE CONFIRM THAT HE PURCHASED SOME 550 TO 600 GRAM OF GOLD ORNAMENTS FR OM THE ASSESSEE BY I.T.A. NO. 4084& 5448/MUM/2013 15 PAYING CASH IN FINANCIAL YEAR 2004-05 AND ALSO 600- 650 GMS OF GOLD ORNAMENTS IN FINANCIAL YEAR 2006-07 , BUT NO FURTHE R DETAIL OF PURCHASE OF ITEM WISE ORNAMENT COULD BE SUBMITTED BY SAID MR AB DUL KADIR FAQIR MOHAMMED RAKHANGI WHICH HE CONFIRMED TO SUBMIT IN DUE COURSE OF TIME BUT WAS NEVER SUBMITTED LATER. HE ALSO SUBMITTED T HAT HE DOES NOT HAVE ANY BANK ACCOUNT AND ALL DEALING WERE MADE BY HIM IN CA SH. SIMILAR STATEMENTS WERE GIVEN ON OATH BY SMT. REHANA KALSEKAR BEFORE T HE AO . THE ASSESSEE HAS ALSO FILED AN AFFIDAVIT (PB 22-23/PB) DATED 20- 06-2012 WHEREIN SHE STATED THAT SHE IS PURSUING MOHMADAM RELIGION BY B IRTH AND GOT MARRIED IN 1950 . IT WAS SUBMITTED BY HER IN THE AFFIDAVIT THA T AT THE TIME OF MARRIAGE HER HUSBAND GAVE HER MEHER OF 4 KG OF GOLD ORNAMENT S AND 150 KG OF SLIVER UTENSIL BEING SECURITY AS PER THEIR TRADITION/CUSTO MS IN SOCIETY. IT WAS ALSO AVERRED THAT SHE USED TO BUY GOLD/SILVER OUT OF HER PIN MONEY AS WELL FROM GIFTS RECEIVED IN CASH .SHE ALSO AVERRED IN THE AFF IDAVIT THAT SHE SOLD GOLD TO THE FOLLOWING PERSONS:- S.NO. NAME WEIGHT DATE AMOUNT 1. ABDUL KADER RAKHANGI AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 596 GMS. 18.04.2004 3,51,640 2. REHANA KALSEKAR AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 675 GMS. 30.04.2004 3,94,875 3. ISMAIL ABDUL RAKHANGI AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 512 GMS. 10.06.2004 3,03,360 4. ALI SAHEB KAZI AT & POST DASOOR TALUKA- RAJAPUR, DIST. RATNAGIRI, MAHARASHTRA 330 GMS. 25.12.2004 2,04,765 SHE ALSO AVERRED IN THE SAID AFFIDAVIT , DETAILS OF CASH DEPOSITS IN THE KOKAN MERCANTILE BANK LTD. ON FOLLOWING DATES DATE OF DEPOSIT AMOUNT 03.05.2004 2,00,000 03.05.2004 2,00,000 03.05.2004 2,00,000 03.05.2004 2,00,000 03.05.2004 2,00,000 I.T.A. NO. 4084& 5448/MUM/2013 16 01.01.2005 2,50,000 IT WAS STATED BY HER IN AFFIDAVIT THAT THE AFORESAI D CASH DEPOSITS IN BANK WERE OUT OF PROCEEDS OF SALE OF GOLD ORNAMENTS . THE CON FIRMATORY LETTERS FROM THESE FOUR PERSONS ALONG WITH DETAILS OF AGRICULTUR AL LAND HOLDINGS OF THESE FOUR PERSONS WERE SUBMITTED WHICH HAS BEEN PLACED O N RECORD IN PAPER BOOK PAGE NO. 26 TO 37. THE ASSESSEE HAS ALSO SUBMITTED COMPUTATION OF INCOME FROM LONG TERM CAPITAL GAINS/LOSSES FROM SALE OF GO LD ORNAMENTS DURING THE REMAND PROCEEDINGS BEFORE THE AO. THE A.O SUBMITTED REMAND REPORT TO LEARNED CIT(A) WHEREIN HE FIRST OF ALL OBJECTED TO THE ADMISSION OF THE SAID ADDITIONAL EVIDENCES AS IN HIS OPINION SUFFICIENT O PPORTUNITY WAS GRANTED BY HIM TO THE ASSESSEE IN ASSESSMENT PROCEEDINGS AND T HERE IS NO JUSTIFICATION PRODUCED BY THE ASSESSEE FOR ADMISSION OF THE ADDIT IONAL EVIDENCES AT THIS STAGE. THEN THE AO SUMMARISED FACTUAL CONTENTIONS P LACED BY THE ASSESSEE BEFORE HIM AND AFTER REPRODUCING THE SAME LEFT THE MATTER TO THE LEARNED CIT(A) TO BE DECIDED BY LEARNED CIT(A) ON MERITS. T HUS, THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE IS DEVOID OF ANY M ERITS THAT THE AO HAS ADJUDICATED THE ISSUE ON MERITS IN REMAND REPORT PR OCEEDINGS RATHER THE AO ONLY SUMMARISED THE ENTIRE FACTUAL DETAILS AS CLAIM ED BY THE ASSESSEE IN REMAND REPORT PROCEEDINGS AND PLACED THE SAME BEFOR E LEARNED CIT(A) FOR HIM TO DECIDE THE ISSUE ON MERITS IN APPELLATE PROC EEDINGS. AFTER CONSIDERING THE REMAND REPORT AND THE ADDITIONAL EVIDENCES SUBM ITTED BY THE ASSESSEE, THE LEARNED CIT(A) REJECTED THE CONTENTIONS OF THE ASSESSEE BY HOLDING THAT TRANSACTIONS FOR SALE OF GOLD ORNAMENTS AS CLAIMED BY THE ASSESSEE IS NOT A GENUINE TRANSACTION AND THE ASSESSEE HAS NOT GIVEN ANY PROOF TO SUBSTANTIATE THAT SHE WAS IN POSSESSION OF GOLD JEW ELLERY AND THERE IS NO EVIDENCE ON RECORD TO PROVE THAT THE SAID GOLD JEWE LLERY WAS SOLD BY THE ASSESSEE TO HER RELATIVE IN CASH. THUS, LEARNED CIT (A) HELD THAT THE ASSESSEE IS NOT ABLE TO EXPLAIN THE SOURCES OF INVESTMENT OF RS.12.50 LACS MADE IN FDR WITH KOKAN MERCANTILE BANK WHICH WAS HELD TO BE UNEXPLAINED INVESTMENTS U/S 69 AND ALSO TREATING THE INTEREST E ARNED THEREON AS UNEXPLAINED INCOME WHICH WERE HELD TO BE TAXABLE IN THE HANDS OF THE ASSESSEE, VIDE APPELLATE ORDER DATED 23-04-2013.WE HAVE GIVEN ANXIOUS , CAREFUL AND PATIENT THOUGHT TO THE WHOLE SPECTRUM O F CONTENTIONS AND MATERIAL ON RECORD SUBMITTED BY THE ASSESSEE AND IT S APPRECIATION BY THE AUTHORITIES BELOW. WE ARE FULLY AWARE THAT THE ASSE SSEE WAS A SENIOR CITIZEN AND AN OLD LADY OF AROUND 75 YEARS DURING THE IMPUG NED ASSESSMENT YEAR I.T.A. NO. 4084& 5448/MUM/2013 17 (DOB 20-01-1930).SHE DIED ON 02-02-2017 FOR WHICH N ECESSARY DEATH CERTIFICATES HAVE BEEN PLACED ON RECORD BY THE ASSE SSEE. THE LEGAL HEIRS ARE BROUGHT ON RECORD AND REVISED FORM NO 36 IS FILED. WE HAVE OBSERVED THAT ASSESSEE FILED RETURN OF INCOME U/S. 139(1) DECLARI NG INCOME OF RS. 46,096/-. THE ASSESSEE HAS MADE HUGE FIXED DEPOSITS OF RS.12. 5 LAKH (RS 30 LACS IN AY 2007-08) IN BANK ACCOUNT WITH KOKAN MERCANTILE BANK WHICH WERE MADE OUT OF CASH DEPOSITS IN THE BANKS AND THE SAID BANK ACC OUNTS AS WELL FDS WERE NOT DECLARED TO THE REVENUE. AN EXPLANATIONS HAS BEEN SOUGHT TO BE OFFERED BY THE ASSESSEE ONLY AFTER THE SAID FIXED DEPOSITS WITH BANKS WERE DETECTED BY REVENUE AS THE FIXED DEPOSIT MADE OUT OF SAID CA SH DEPOSITS AND INTEREST EARNED THEREON THE SAID FDS WERE NOT DECLARED BY T HE ASSESSEE TO THE REVENUE IN THE RETURN OF INCOME FILED WITH THE REVE NUE . THE CASE OF THE ASSESSEE WAS UNDER SCRUTINY FOR ASSESSMENT YEAR 200 8-09 WHEN SAID NON DISCLOSURE/NON DECLARATION OF INCOME BY THE ASSESSE E TO THE REVENUE WAS DETECTED FOR THE FIRST TIME BY THE AO WHICH LED TO REOPENING OF THE ASSESSMENT U/S 147 FOR IMPUGNED ASSESSMENT YEAR 200 5-06 , WHEREIN THE ASSESSEE HAS NOT RAISED ANY CHALLENGE TO REOPENING OF ASSESSMENT U/S 147 WHICH HAS REACHED FINALITY. THE ASSESSEE CAME FORW ARD WITH THE DETAILS OF THE SOURCES OF CASH DEPOSITS IN BANK ACCOUNT TO THE TUNE OF RS. 12.50 LACS ( AY 2007-08 RS 30 LACS) BY BRINING ON RECORD FOUR PE RSONS WHO WERE CLOSE RELATIVES OF THE ASSESSEE OUT OF WHOM TWO PERSONS N AMELY SHRI ABDUL KADER FAQIR MOHAMMED RAKHANGI AND MS. REHANA KALESKAR HAV E GIVEN STATEMENTS ON OATH BEFORE THE A.O OWNING THE SAID TRANSACTION S FOR PURCHASE OF GOLD ORNAMENTS FROM THE ASSESSEE BUT THE ENTIRE PURCHASE S WERE CLAIMED TO BE MADE IN CASH. IT IS STATED BY SAID PERSONS THAT THE Y HAVE AGRICULTURAL LAND WHICH IS INHERITED FROM ANCESTORS AND MANGOES ARE G ROWN THERE AND THESE GOLD ORNAMENTS ARE PURCHASED FROM THE SALE OF MANGO ES IN CASH AND FROM PAST SAVINGS. THEY HAVE GIVEN DOCUMENT OF THEIR LAN D HOLDING AND YEARLY INCOME IS IN THE RANGE OF RS. 5-7 LACS WHILE NO RET URN OF INCOME HAS BEEN FILED BY THEM NOR ARE THEY HOLDING PAN . NO LINKAGE S OF CASH WITHDRAWAL FROM BANK HAS BEEN BOUGHT ON RECORD RATHER THE SAID PERS ONS CLAIMED THAT THEY ARE NOT MAINTAINING ANY BANK ACCOUNT AND/OR THE BAN K ACCOUNTS ,IF MAINTAINED WERE NOT PRODUCED BEFORE THE AO. NO CONT EMPORANEOUS EVIDENCES ARE BROUGHT ON RECORD TO PROVE THESE PURC HASES OF GOLD BY THESE PERSONS FROM THE ASSESSEE. THESE TWO PERSONS WERE N OT HAVING PAN AND NOT FILING RETURN OF INCOME WITH THE REVENUE. THE SAID GOLD SO PURCHASED FROM I.T.A. NO. 4084& 5448/MUM/2013 18 THE ASSESSEE HAS NOT BEEN DECLARED AND DISCLOSED BY THESE BUYERS TO THE REVENUE IN RETURN OF INCOME FILED WITH REVENUE IN-F ACT BOTH OF THEM WERE NOT FILING THEIR INCOME-TAX RETURNS WITH REVENUE. THESE PERSONS CARRIED OUT ALL TRANSACTIONS OF PURCHASE OF GOLD ORNAMENTS IN CASH. THESE TWO PERSONS CLAIMED THAT THEY OWN AGRICULTURAL LAND WHICH IS TH EIR AGRICULTURAL LAND WHEREIN MANGOES WERE GROWN AND THEY HAVE INCOME FRO M SALE OF MANGOES WHICH ARE SOLD THROUGH AGENTS FOR WHICH PROCEEDS AR E REALISED IN CASH. THE INCOME FROM THESE AGRICULTURAL ACTIVITY IS ALSO STA TED TO THE TUNE OF RS. 5-7 LACS IN A YEAR. NO CASH FLOW STATEMENTS HAVE BEEN S UBMITTED BY THESE PERSONS TO SUBSTANTIATE THAT CASH WAS DULY UTILISED TO BUY GOLD ORNAMENTS AND THEIR EARNINGS WERE SUFFICIENT TO SUSTAIN THEIR FAMILY REQUIREMENTS ETC.. THESE TWO PERSONS COULD NOT GIVE ITEM WISE DETAILS OF ORNAMENTS PURCHASED FROM THE ASSESSEE WHEN SPECIFICALLY ASKED BY REVENU E , WHILE IT WAS EXPECTED FROM THEM AT THE TIME OF RECORDING OF STATEMENT TO CARRY ALL DETAILS WITH THEM. THEY PROMISED TO GIVE ITEM-WISE DETAILS OF OR NAMENTS PURCHASED FROM THE ASSESSEE BUT NO DETAILS WERE FILED BY THE SAID PERSONS SUBSEQUENTLY. THE CONFIRMATORY LETTERS WERE ALSO PRODUCED FROM THE FO UR PERSONS WHO BOUGHT THE GOLD ( INCLUDING TWO PERSONS WHO GAVE STATEMENT ON OATH) CONFIRMING THE TRANSACTION OF PURCHASE OF GOLD ORNAMENTS FROM THE ASSESSEE. THE LAND HOLDINGS OF THESE PERSONS WHEREIN MANGOES WERE CLAI MED TO BE GROWN IS BROUGHT ON RECORD AND IS STATED BY ALL THAT THEY AR E AGRICULTURIST AND INCOME FROM SALE OF MANGOES AS WELL PAST SAVINGS WERE UTIL ISED TO BUY GOLD OF RS 12.50 LACS( RS. 30 LACS IN AY 2007-08) . THE ASSES SEE HAS ALSO EXECUTED AN AFFIDAVIT AVERRING THAT THE TRANSACTIONS FOR SALE O F GOLD ORNAMENTS TO THESE FOUR PERSONS WAS IN CASH . DEPOSITS OF A SUCH HUGE AMOUNT OF CASH IN THE BANK ACCOUNT BEING 12.5 LAKH IN A.Y 2005-06 AND RS. 30,00,000/- FOR A.Y 2007-08 HAS TO BE PROPERLY EXPLAINED BY THE ASSESSE E WITH COGENT EVIDENCES AND MATERIAL ESPECIALLY CONTEMPORANEOUS EVIDENCES W HICH COULD ESTABLISH THAT TRANSACTIONS AS CLAIMED DID TOOK PLACE AT THAT POINT OF TIME WHICH CAN INSPIRE CONFIDENCE. NONE OF THE CONTEMPORANEOUS EVI DENCES ARE BROUGHT ON RECORD BY THE ASSESSEE TO SUBSTANTIATE THE HAPPENIN G OF THE TRANSACTION AT THAT TIME. IT IS IMPORTANT TO REFER TO PROVISIONS O F SECTION 106 AND 114(G) OF THE INDIAN EVIDENCE ACT,1872. SECTION 106 OF THE 18 72 ACT STIPULATES THAT BURDEN OF PROVING FACT WHICH IS ESPECIALLY WITHIN T HE KNOWLEDGE OF ANY PERSON IS ON THAT PERSON. SIMILARLY SECTION 114(G) OF THE 1872 ACT STIPULATES THAT THE EVIDENCE WHICH COULD BE AND IS NOT PRODUCE S WOULD , IF PRODUCED, BE I.T.A. NO. 4084& 5448/MUM/2013 19 UNFAVOURABLE TO THE PERSON WHO WITHHOLDS IT. THE AS SESSEES HAS CLAIMED THAT 4 KG OF GOLD ORNAMENTS AND 150 KGS OF SILVER UTENSIL WERE GIVEN TO HER AS MEHER AS PER MOHMADAM CUSTOMS AND SHE WAS MARRIE D IN 1950 . IT WAS ALSO AVERRED THAT GOLD ORNAMENTS WERE PURCHASED FR OM TIME TO TIME OUT OF HER PIN MONEY AND GIFTS RECEIVED. THE ASSESSEE HAS NOT BROUGHT ON RECORD ANY EVIDENCE OF CONTRACT OF MEHER IN HER FAVOUR NO R INDEPENDENT WITNESSES ARE BROUGHT ON RECORD TO SUBSTANTIATE THAT THE SAID MEHER WAS GRANTED IN HER FAVOUR BY HER HUSBAND AT THE TIME OF MARRIAGE. THERE IS NO EVIDENCE ON RECORD WHICH SUBSTANTIATE THIS CONTENTION OF THE AS SESSEE AND THIS IS TO BE EVALUATED ON TOUCHSTONE OF PREPONDERANCE OF PROBABI LITIES AS THE ASSESSEE HAS NEVER DECLARED GOLD/SILVER HOLDINGS IN THE RETU RNS OF INCOME FILED WITH REVENUE NOR THE SAID DETAILS ARE FILED WITH ANY AUT HORITIES AS NO SUCH EVIDENCES IS BROUGHT ON RECORD. EVEN DETAILS AS TO FAMILY BACKGROUND/STATUS OF THE FAMILY INCLUDING ASSETS AND EARNINGS OF FAMI LY MEMBERS ARE NOT SUBMITTED TO SUBSTANTIATE THAT SUCH GOLD /SILVER HO LDING IS REASONABLE KEEPING IN VIEW FAMILY BACKGROUND/STATUS OF THE ASS ESSEE. THE ASSESSEE HAS NOT BROUGHT ON RECORD ANY EVIDENCES OF BUYING GOLD/ SILVER BY WAY OF INVOICES OR CHEQUE PAYMENTS TO SUBSTANTIATE ITS CLAIM THAT SHE BOUGHT GOLD/SILVER FROM TIME TO TIME FROM HER PIN MONEY OR GIFTS. NO DETAILS OF FAMILY BACKGROUND AND STATUS OF THE FAMILY INCLUDING THEIR EARNINGS AND ASSETS HAS BEEN BROUGHT ON RECORD TO JUSTIFY HOLDING OF GOLD / SILVER OF SUCH MAGNITUDE. THE ASSESSEE HAS NOT SINCE 1950 EVER DECLARED THESE HOLDINGS OF GOLD /SILVER IN INCOME TAX RETURNS FILED WITH REVENUE. THE ASSES SEE DID NOT EVER FILE ANY WEALTH TAX RETURNS WITH THE REVENUE. THE ASSESSEE H AS ORIGINALLY FILED RETURN OF INCOME U/S 139(1) BUT DID NOT DECLARE INCOME FRO M CAPITAL GAINS ARISING FROM SALE OF GOLD ORNAMENTS AS CLAIMED BY THE ASSES SEE. THE ASSESSEE HAS FILED ONE VALUATION REPORT DATED 16-04-2002 VALUING HER GOLD ORNAMENTS AND SILVER UTENSIL HELD BY HER AT 31-03-2002, WHICH IS ISSUED BY SH. AJIT AMARCHAND JHAVERI (APPROVED VALUERS) WHICH IS PLACE D IN PAPER BOOK/PAGE 62-64. IT IS NOT EXPLAINED BY THE ASSESSEE WHY SHE OBTAINED SAID VALUATION REPORT IN 2002 AND HAVING SO OBTAINED WHY SHE DID N OT ACTED UPON THE SAID VALUATION REPORT BY DECLARING THE SAID GOLD/SILVER IN HER INCOME TAX RETURNS AND ALSO SHE NEEDED TO EXPLAIN WHY SHE DID NOT FILE D HER WEALTH TAX RETURN THEREAFTER EVEN AFTER OBTAINING THE SAID VALUATION REPORT IN 2002 WHICH ESTABLISHES HER LIABILITY TOWARDS WEALTH TAX. EVEN THE ASSESSEE DID NOT DECLARE AND BROUGHT ON RECORD THE SAID GOLD ORNAMEN TS/SILVER IN HER BALANCE I.T.A. NO. 4084& 5448/MUM/2013 20 SHEETS FILED WITH REVENUE EVEN AFTER OBTAINING VALU ATION REPORT IN 2002. IT IS ALSO NOT BROUGHT ON RECORD WHETHER THE SAID VALUER RAISED ANY INVOICE FOR HIS FEE FOR DOING THIS VALUATION REPORT AND WHETHER AN Y PAYMENT FOR SAID FEE WAS MADE BY CHEQUE AT THAT POINT OF TIME. THE ONUS WAS ON THE ASSESSEE TO PROVE GENUINENESS OF THE TRANSACTION FOR PURCHASE , ACQUI SITION AND SALE OF GOLD/SILVER WHICH THE ASSESSEE FAILED TO DISCHARGE. THUS, THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE IS DEVOID OF A NY MERITS THAT THE AO HAS ADJUDICATED THE ISSUE ON MERITS IN REMAND REPORT PR OCEEDINGS RATHER THE AO ONLY SUMMARISED THE ENTIRE FACTUAL DETAILS AS CLAIM ED BY THE ASSESSEE IN REMAND PROCEEDINGS AND PLACED THE SAME BEFORE LEARN ED CIT(A) FOR HIM TO DECIDE THE ISSUE ON MERITS. THE CASE LAWS RELIED UP ON BY THE ASSESSEE ARE CLEARLY DISTINGUISHABLE . IN THE CASE OF SHANTI SWA RUP(SUPRA), HONBLE PUNJAB AND HARYANA HIGH COURT UPHELD THE DECISION OF TRIBU NAL AS THE DECISION OF THE TRIBUNAL WAS BASED ON APPRECIATION OF FACTS. TH IS DECISION HAS NO APPLICATION TO THE CASE IN HAND WHICH IS DECIDED ON ITS OWN FACTS ON MERITS . THE ASSESSEE HAS ALSO PLACED RELIANCE ON DECISION O F HONBLE SUPREME COURT IN THE CASE OF MEHTA PARIKH & CO(SUPRA) IS A CASE W HERE CASH BOOK STOOD ACCEPTED AND AFFIDAVITS WERE PRODUCED BEFORE AAC TO EXPLAIN THE TRANSACTIONS , IT WAS HELD THAT AFFIDAVIT COULD NOT BE REJECTED IN THE ABSENCE OF CROSS EXAMINATION OF THE DEPONENT. IN THE INSTAN T CASE BEFORE US STATEMENTS OF TWO PERSONS WHO ALLEGEDLY PURCHASED G OLD FROM THE ASSESSEE IN CASH WERE RECORDED WHEREIN THEY EXPLAINED THAT THEY PURCHASED GOLD FROM ASSESSEE IN CASH FROM AGRICULTURAL INCOME . THESE P ERSONS COULD NOT SUBMIT ITEM WISE DETAILS OF ORNAMENTS PURCHASED FROM ASSES SEE NOR THEY COULD SUBMIT THE CASH FLOW STATEMENTS TO JUSTIFY THE PURC HASE OF GOLD FROM THE ASSESSEE IN CASH. THEY EACH HAVE INCOME OF ONLY RS. 5-7 LACS PER YEAR ONLY AND THEY CLAIMED THAT THEY PURCHASED GOLD OF RS 3.5 0-RS 4.0 LACS EACH FROM THE ASSESSEE WHICH DOES NOT INSPIRE CONFIDENCE ON T HE TOUCHSTONE OF PREPONDERANCE OF PROBABILITIES ALSO. NO CONTEMPORAR Y EVIDENCES HAVE BEEN BROUGHT ON RECORD BY EITHER PARTY TO SUBSTANTIATE A ND PROVE GENUINENESS OF PURCHASES OF GOLD FROM THE ASSESSEE. THEY HAVE NOT DECLARED THE SAID GOLD IN THEIR RETURNS OF INCOME RATHER THEY DID NOT EVEN HE LD PAN NOR HAD EVER FILED ANY RETURN OF INCOME WITH REVENUE. THEY DID NOT EIT HER HELD BANK ACCOUNTS OR THEY DID NOT PRODUCE THE BANK ACCOUNTS EITHER BE FORE THE AUTHORITIES BELOW. THESE PERSONS ARE ALSO CLOSE RELATIVES OF TH E ASSESSEE. THUS, THE STATEMENTS OF THE SAID PERSONS WHO WERE WITNESSES I S NOT SUPPORTED BY I.T.A. NO. 4084& 5448/MUM/2013 21 EVIDENCES ON RECORD. THE AFFIDAVIT OF THE ASSESSEE IS A SELF SERVING DOCUMENT, WHILE WE HAVE OBSERVED SERIOUS FLAWS AND DEFICIENCI ES IN THE CONTENTION OF THE ASSESSEE WHICH ARE DETAILED ABOVE AND ARE NOT R EPEATED AGAIN . KEEPING IN VIEW ENTIRE FACTUAL MATRIX OF THE CASE AS DETAIL ED ABOVE , WE HAVE OBSERVED THAT THE WHOLE STORY OF SALE OF GOLD ORNAMENT/SILVE R IN CASH TO CLOSE RELATIVES WAS SET UP BY THE ASSESSEE AFTER THE ASSESSEE WAS C ORNERED BY REVENUE AND IT DOES NOT INSPIRE CONFIDENCE , THUS HER CONTENTIO NS ARE HEREBY REJECTED BECAUSE NEITHER THE PURCHASE/HOLDING OF GOLD ORNAME NTS/SILVER IS PROVED NOR THE GENUINENESS OF THE SALE OF GOLD ORNAMENTS/SILVE R STOOD PROVED BASED ON MATERIAL ON RECORD. THE SAID FDRS AND INTEREST EAR NED ON THEM WERE NEVER DECLARED BY THE ASSESSEE TO THE REVENUE AND WAS DET ECTED BY THE REVENUE DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR AY 2008-09 WHILE LED TO REOPENING OF ASSESSMENT U/S 147 FOR THE IMPUGNED AS SESSMENT YEAR 2005- 06 AND ASSESSEE IN ORDER TO JUSTIFY THE RECEIPT OF CASH OF APPROX. RS.52.5 LAKH WHICH STOOD DEPOSITED IN BANK ACCOUNT IN PREVI OUS YEARS RELEVANT TO A.Y 2005-06 AND 2007-08 CAME FORWARD WITH THIS THEO RY OF SALE OF GOLD ORNAMENTS/SILVER IN CASH TO CLOSE RELATIVES WHO ARE NOT EVEN HOLDING PAN AND ARE NOT FILING RETURN OF INCOME WITH REVENUE . THE STATEMENTS ON OATH RECORDED OF THESE PERSONS WHO ARE CLOSE RELATIVES A ND STATED TO HAVE PURCHASED GOLD ORNAMENTS IN CASH FROM THE ASSESSEE DO NOT INSPIRE CONFIDENCE DUE TO VARIOUS REASONS CITED ABOVE. THE AFFIDAVIT SUBMITTED BY THE ASSESSEE IS A SELF SERVING DOCUMENTS WHICH IS REJEC TED IN THE ABSENCE OF COGENT AND RELIABLE EVIDENCES ON RECORD TO SUBSTANT IATE ASSESSEES CONTENTIONS. IT IS IMPORTANT TO REFER TO PROVISIONS OF SECTION 106 AND 114(G) OF THE INDIAN EVIDENCE ACT,1872. SECTION 106 OF THE 18 72 ACT STIPULATES THAT BURDEN OF PROVING FACT WHICH IS ESPECIALLY WITHIN T HE KNOWLEDGE OF ANY PERSON IS ON THAT PERSON. SIMILARLY SECTION 114(G) OF THE 1872 ACT STIPULATES THAT THE EVIDENCE WHICH COULD BE AND IS NOT PRODUCE S WOULD , IF PRODUCED, BE UNFAVOURABLE TO THE PERSON WHO WITHHOLDS IT. THUS, THE ONUS WAS ON THE ASSESSEE TO HAVE BRING ON RECORD COGENT AND RELIABL E EVIDENCES TO SUPPORT HER CONTENTIONS. HOWEVER, WE CANNOT ALSO SHUT OUR E YES TO REALITY OF INDIAN LIVES WHEREIN THERE IS A LOVE, PRIDE AND PREFERENCE OF INDIAN HOUSEHOLDS TO INVEST AND HOLD GOLD ORNAMENTS ETC FOR THEIR USAGE AS WELL FOR RAINY DAYS WHEREIN GOLD CAN BE SOLD TO TIDE OVER FINANCIAL DIF FICULTIES. HOWEVER, WE ALSO NOTE THAT THERE IS A CBDT INSTRUCTION/GUIDELINES NO . 1916 DATED 11TH MAY, 1994 WHICH ALTHOUGH RELATES TO NON SEIZURE OF GOLD DURING THE COURSE OF I.T.A. NO. 4084& 5448/MUM/2013 22 SEARCH OPERATION U/S 132 WHICH HAS DULY CONSIDERED INDIAN TRADITIONS AND CULTURE , WHEREIN IT IS PERMITTED BY CBDT NOT TO SE IZE GOLD ORNAMENTS AND JEWELLERY IN CASE OF MARRIED LADY TO THE TUNE OF 50 0 GRAM IN THE COURSE OF SEARCH OPERATIONS WHERE NO WEALTH TAX RETURNS ARE F ILED BY SAID MARRIED LADY AND HENCE WE ARE OF THE VIEW THAT THE EXPLANATION O F THE ASSESSEE OF HOLDING OF THE GOLD ORNAMENT/JEWELLERY TO THE TUNE OF 500 G RAM STAND ACCEPTED , WHILE THE REST OF THE THEORY OF SELLING BALANCE OF THE GOLD /SILVER AS PUT FORWARD BY THE ASSESSEE STOOD REJECTED AND IT IS HE LD THAT THE ASSESSEE COULD NOT SUBSTANTIATE THE GENUINENESS OF THE TRANSACTION FOR THE BALANCE QUANTITY OF SALE OF GOLD ORNAMENTS/SILVER AND HENCE AFTER GI VING CREDIT FOR VALUE OF GOLD TO THE TUNE OF 500 GMS, REST OF THE AMOUNT SHALL BE CHARGED TO TAX IN THE HANDS OF THE ASSESSEE AS UNDISCLOSED INCOME . WHILE FOR SALE OF 500 GRAM OF THE GOLD , THE SAME SHALL BE BROUGHT TO TAX BY COMP UTING INCOME FROM CAPITAL GAINS FOR WHICH THE ASSESSEE SHALL SUBMIT NECESSARY DETAILS WHICH SHALL BE VERIFIED BY THE AO IN ACCORDANCE WITH LAW. THUS, WE CONFIRM THE APPELLATE ORDER OF LEARNED CIT(A) WITH ABOVE MODIFICATION WHE REIN THE ASSESSEE WILL GET PART RELIEF AS DETAILED ABOVE. WE ORDER ACCORDINGLY . 12. IN THE RESULT APPEAL OF THE ASSESSEE IN ITA NO. 4084/MUM/2013 FOR AY 2005-06 IS PARTLY ALLOWED. WE ORDER ACCORDINGLY. 13. NOW WE WILL TAKE UP APPEAL FOR AY 2007-08 IN IT A NO. 5448/MUM/2013. OUR DECISION IN ITA NO. 4084/MUM/2013 FOR ASSESSMEN T YEAR 2005-06 SHALL APPLY MUTATIS MUTANDIS TO THE APPEAL OF THE ASSESSE E IN ITA NO. 5448/MUM/2013 FOR AY 2007-08 AS THE FACTS ARE SIMI LAR FOR BOTH THE YEARS. WE CLARIFY THAT BENEFIT OF AFORE-STATED CBDT INSTRU CTION/GUIDELINE SHALL BE EXTENDED ONCE AND NOT TWICE SEPARATELY FOR BOTH THE YEARS UNDER CONSIDERATION. THE ASSESSEE HAS ALSO RECEIVED GIFT OF RS. 3.0 LACS IN CASH FROM MR ABDUL KADER FAKIR MOHAMMED RAKHANGI , A CLO SE RELATIVE. THE CASH RECEIVED BY THE ASSESSEE FROM GITS OF RS. 3,00,000/ - ALSO DID NOT STOOD PROVED AS NO GIFT DEED/CONFIRMATIONS ARE PRODUCED F ROM DONOR BY THE ASSESSEE NOR GENUINENESS OF THE GIFT IS PROVED. THE SAID DONOR HAS CLAIMED TO HAVE NOT MAINTAINED ANY BANK ACCOUNT . HE HAS CLAIM ED TO HAVE GIVEN GIFT OF RS. 3,00,000/- AS WELL PURCHASED GOLD OF RS. 5.62 L ACS FROM THE ASSESSEE FOR IMPUGNED ASSESSMENT YEAR OUT OF HIS TOTAL CLAIMED I NCOME FROM AGRICULTURE FROM SALE OF MANGOES OF RS. 6-7.50 LACS. HE DOES NO T HOLD ANY PAN AND HAS NEVER FILED RETURN OF INCOME .. WE HAVE ALREADY DIS CUSSED ABOUT I.T.A. NO. 4084& 5448/MUM/2013 23 CREDITWORTHINESS OF SAID MR ABDUL KADER FAKIR MOHAM MED RAKHANGI WHILE ADVERTING TO HIS PURCHASES OF GOLD FROM THE ASSESSE E WHILE ADJUDICATING APPEAL FOR AY 2005-06 NOR EVEN GENUINENESS OF GIFT IN CASH FROM MR ABDUL KADER FAKIR MOHAMMED RAKHANGI IS PROVED. IT IS INCO MPREHENSIVE THAT HE HAS INCOME OF RS. 6-7.50 LACS FOR THE PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR 2007-08 AND HE HAS UTILISED RS 8.62 LACS IN PU RCHASING GOLD AND GIVING GIFT TO ASSESSEE. WE ORDER ACCORDINGLY. 14. IN THE RESULT APPEAL OF THE ASSESSEE IN ITA NO. 5448/MUM/2013 FOR AY 2007-08 IS PARTLY ALLOWED. WE ORDER ACCORDINGLY. 15. IN THE RESULT, BOTH THE APPEAL OF THE ASSESSEE S FOR AY 2005-06 AND 2007-08 RESPECTIVELY ARE PARTLY ALLOWED AS INDICATE D ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 29.09.2017 !' # $ 29.09.2017 SD/- SD/- (JOGINDER SINGH ) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 29.09.2017 COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) CONCERNED, MUMBAI 4. THE CIT- CONCERNED, MUMBAI 5. THE DR BENCH, E 6. MASTER FILE // TUE COPY// BY ORDER DY/ASSTT. REGISTRAR ITAT, MUMBAI